As clock ticks down, lawmakers and USDA push for new farm law

WASHINGTON (Reuters) - With time running out, agricultural leaders in Congress vowed on Thursday to do everything they can to pass a farm bill that cuts spending by at least $23 billion - savings that could assure support by lawmakers determined to reduce the federal deficit.

The five-year, $500 billion farm bill has been deadlocked in the House of Representatives since mid-July, although the Senate has passed its version of the bill.

Without a new law, one of the first major ramifications could be a sharp increase in milk prices in early 2013 under the dictates of an archaic fall-back statute.

"I'd like to see it anyway we can do it," said Michigan's Debbie Stabenow, chairwoman of the Senate Agriculture Committee, when asked if the farm bill could become part of the deficit reduction package that is the chief goal of the lame-duck session. "We're going to do everything we can to work together to get to a five-year farm bill."

Stabenow and the other leaders of the Senate and House Agriculture committees were unified in the push for a full-scale farm bill after meeting on Thursday with Agriculture Secretary Tom Vilsack for 40 minutes in a post-election get-together.

Congress is scheduled to adjourn for the year in 15 days -- too little time for the usual methods to reconcile conflicts between the House and Senate, which disagree strongly on the size of cuts in crop subsidies and food stamps for the poor. The House bill calls for the biggest food stamp cuts in a generation.

Some farm lobbyists believe Congress will extend the 2008 law, which expired on September 30, and try again next year for a long-term bill.

Farm leaders such as Roger Johnson, president of the 300,000-member National Farmers Union, say it will be easier to wrap a five-year bill into a deficit package than to pursue an extension which has its own pitfalls. The farm bill would offer budget cuts at a time when cuts are paramount - $23 billion over 10 years in the Senate bill and $35 billion in the bill approved by the House Agriculture Committee.

"Until sine die (adjournment) occurs, there is not really a drop-dead" day to agree on a five-year bill, said Dale Moore of the 6 million-member American Farm Bureau Federation.

Besides food stamps, the House and Senate bills disagree on the direction of farm subsidies. The House bill would boost support prices by as much as 40 percent. The Senate would replace traditional subsidies with an insurance-like program that protects farmer revenue against poor yields or low prices.

Both bills would end the $5 billion-a-year "direct payment" subsidy that is the major target of reformers, and both would expand the federally subsidized crop insurance system.

"The truth is, we're running out of time," said a farm lobbyist. He said there was little indication of staff-level work to produce a final version of the bill, a view repeated by others.

Stabenow, however, said the Agriculture Committee leaders "never stopped" work on the bill. She said the four leaders did not go into specifics of the legislation while meeting with Vilsack, but they did agree on the goal of a five-year bill. The three other leaders, Sen. Pat Roberts, Kansas Republican, House Agriculture chairman Frank Lucas of Oklahoma, and Rep. Collin Peterson, Minnesota Democrat, each endorsed the effort.

Vilsack said the Obama administration also wants a five-year farm bill which would allow farmers and agribusinesses to plan their spending for years into the future.

(This story corrects fourth paragraph to show Stabenow from Michigan, not Maine)